What is in this article?:
- Bob Price, Burwell, NE, Wins National Stocker Award
- Planned grazing is the key
- Refining the grazing system
- Start by knowing true costs
Planned discipline begets flexibility and stocker profit for Bob Price and Gracie Creek Ranch, BEEF magazine’s 2012 National Stocker Award honoree.
Start by knowing true costs
DeGroff says what sets Gracie Creek Ranch apart is the willingness to admit they don’t have all of the answers. Adds Price about the decision to enlist outside experts like DeGroff: “Sometimes, you have to give up control in order to gain control.”
This operation leaves as little to chance as possible. The grazing system is an example, as is Price’s penchant for locking up feed ahead of time. In August, he already knew his cost of gain for calves he’ll purchase in the fall.
One reason he’s comfortable making decisions further out is because he knows his true costs and financial position heading in.
“There are no opportunity values used in calculating at Gracie Creek Ranch,” DeGroff says. “It’s all actual costs.” Right down to charging itself the going rate for grass.
By knowing his costs, Price can establish profit goals for each set of calves. Thus, he knows when that goal is achieved, allowing him to manage his risk with futures and options when appropriate. Incidentally, Price can tell you that his calves accounted for a 13.13% return on investment last year.
“In agriculture, you have a lot of risk. Managing that risk gives us more opportunity for the future,” Price says. By the same token, he allows, “Those who take reasonable risks seem to get along better than those who take no risk.”
Price says his dad Jim passed on to him the lessons he learned from his father. Among them was that the buy often determines ultimate profitability. “Your grandfather walked away from more deals than he ever made,” Jim told his son.
“Don’t try to outguess the market, take the good with the bad, and most importantly manage risk so that you can be there for the good years,” Price says.
Price also learned early in life the value of sorting cattle to make them more marketable to buyers. From the time cattle arrive at Gracie Creek to when they leave, Price will have sorted them at least five times, swapping cattle among groups to achieve the pea-in-a-pod consistency mentioned earlier.
“He doesn’t just build uniform load lots,” DeGroff says. “He builds uniform pen lots of 200-300 head. That’s the single biggest thing he does to add value to the calves.”
Price is such a stickler for uniformity that he winds up with 70 head or so every year that just don’t fit any group. He’ll feed them out in a local yard rather than accept the discounts the market would impose.
Price merely credits the procurement prowess of his trusted order buyer, Jeremy Olson at Randolph, NE. “We’re blessed to live in an area that allows us access to high-quality genetics and markets that will recognize quality cattle,” Price adds.
Ask folks who know him, though, and they’ll tell you Price not only understands the business of grass inside and out, but possesses that rare eye for reading cattle.
“If you’re patient, it seems like somewhere along the way you’ll have a chance to make them work.”